While money may not buy you happiness, not having enough of it can certainly dampen your happiness. Living paycheck-to-paycheck is a very stressful way to live. Not only are you constantly aware that the loss of your job could mean defaulting on your mortgage or missing a deadline for bills, but you are also not able to save anything for retirement or for an emergency. If you’re looking to get a leg up on your personal finances, you want to find a way to improve your overall net worth. Your net worth – which is the value of all your assets, like bank accounts and property, minus your liabilities like your mortgages and any credit card debt you might have – is the best way to figure out your overall financial health.
So what are some ways you can boost your financial standing? Here are four tips:
1. Get a raise or find a better paying job
Increasing your main income is the easiest and fastest way you can increase your net worth. If you work for a company on a salary, you may have your annual raise assessed each year. You can bring up the possibility of a salary increase before that time, so long as you have a solid understanding of why your value has increased exponentially. If you feel that you have reached the cap of what you can earn at your current company, consider shopping for a better paying job at another company.
2. Buy a house
There is a lot of initial cash outflow when you buy a home, however, if you have the money to purchase a home it’s a great way to increase your net worth. Renting, while initially cheaper, does nothing for your net worth. By purchasing a home, any mortgage payments you make will go towards building equity on your home. Since there is the potential for you to get all that money back and more if you sell, this increases your net worth. However, since you will have to take on debt initially, it won’t increase your net worth right away.
3. Spend less, save more
If you’re in the position to spend less and save a bit more, now’s the time to do it. If you’re spending money on items that lose value or don’t appreciate, your net worth will suffer. If you’re able to decrease your spending, you can start to increase your savings account. Initially, you should focus on bulking out a savings account to about $1,000 to account for emergencies. From there, you should look to continue building your savings until you feel secure, and then look into investing.
4. Invest in stocks
Don’t let extra cash hang around and not work for you. Learning to invest properly is a great way to increase your net worth. Of course, it can be a bit intimidating to start investing, which is why following a blog like my wealth and investment can be great to boost your net worth, so long as you make sound investments. When you’re in the process of initially bulking your net worth, look for secure, long-term investments with steady growth and don’t go for flashy, high loss stocks.
